In the early stages of 2026, the real estate sector has been abuzz with astonishing news. Following President Trump’s announcement last week that he would instruct mortgage giants Fannie Mae and Freddie Mac to purchase $200 billion in mortgage loans, the 30-year fixed mortgage rates have hit a new low in nearly three years. Sales of existing homes in the United States in the final quarter of last year saw the strongest growth in nearly three years. Loan applications in January this year have also seen a significant increase.
According to the National Association of Realtors (NAR), existing home sales in the United States saw a notable year-end rebound in December: a 5.1% month-over-month increase, with a seasonally adjusted annual sales rate reaching 4.35 million units.
While overall home sales in 2025 remained at historically high levels, there was a turnaround in the fourth quarter. NAR’s chief economist Lawrence Yun stated that the fourth-quarter drop in mortgage rates and the slowing pace of home price increases led to the highest sales volume in December in nearly three years. Real estate sales in all four major regions of the United States showed comprehensive improvements.
Yun also indicated that housing inventory remains tight, with sellers less willing to part with their properties. Similar to previous years, he expects more listings to enter the market starting from February.
The inventory of homes for sale in December stood at 1.18 million units, a decrease of 18.1% from November, but a 3.5% increase compared to December 2024 (1.14 million units). The supply of inventory was at 3.3 months, lower than the previous month’s 4.2 months. The median home price was $405,000, a 0.4% increase from the same period in 2024, marking the 30th consecutive month of year-over-year price growth.
Furthermore, after President Trump directed the “two houses” to purchase $200 billion in mortgage debt, the average 30-year fixed mortgage rate suddenly dropped, breaking the psychological threshold of 6%. According to Zillow’s rate index, the 30-year fixed mortgage rate fell to 5.87% this Monday, the lowest level since February 2023. Over the past year, the average rate on a 30-year mortgage has dropped by over 1%.
Following President Trump’s speech last Thursday (January 8), there has been a surge in demand for refinancing in the real estate market. According to a report from the Mortgage Bankers Association (MBA) cited in the “Daily Loan News,” as of the week ending January 9, loan applications surged by 28.5%, with the refinance index skyrocketing by 40% compared to the previous week, and a 128% increase from the same period last year, marking the strongest single-week increase since October last year. Home purchase applications also surged significantly last week, rising by 13% compared to the same period last year.
MBA Vice President and Deputy Chief Economist Joel Kan believes that lower rates and higher inventory are keeping potential homebuyers active in the real estate market.
Mischa Fisher, Chief Economist at Zillow Group, noted that over the past three years, many homeowners purchased homes at higher rates. As they refinance, releasing new household cash flow, this will further stimulate overall economic activity. He anticipates:
A 33 basis point decrease in mortgage rates in 2026, equivalent to savings of about $60 per month on a typical new mortgage. Even without a drop in the federal funds rate, the average mortgage rate for 2026 is expected to decrease from the previous 6.1% to 5.8%.
Buying power will continue to improve, with existing home sales projected to increase by 6.4%, higher than the previous 3.9%. However, as sales growth outpaces the increase in new listings, home inventory will decline.
Average home price growth is expected to slightly accelerate to 7.8%, higher than the 7.6% before Trump’s securities-supporting remarks.